Business Management: Marketing Assesment
The person credited with the first systematic expression of the principle of comparative advantage wa
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1. The person credited with the first systematic expression of the principle of comparative advantage was ( )
A. Alan Greenspan.
B. John Maynard Keynes.
C. David Ricardo.
D. Adam Smith.
2. A regulation that sets the highest price at which it is legal to trade a good is a ( )
A. Production quota
B. Price floor
C. Price ceiling
D. Tax ceiling
3. In Country J, it takes one hour to knit a pair of socks, and five hours to brew a gallon of cider. In Country K, it takes three hours to knit a
pair of socks, and six hours to brew a gallon of cider. If trade were to open between the two countries, Ricardo would predict that ( )
A. Country J will export cider and Country K will export socks.
B. Country J will export socks and Country K will export cider.
C. Country J will export both socks and cider.
D. Country K will export both socks and cider.
4. If Nation A can produce either 3x or 3y with one hour of labor, while nation B can produce either 1x or 1y with one hour of labor, and if
labor is the only input, then ( )
A. Nation A has an absolute advantage in both goods.
B. Nation B has an absolute advantage in both goods.
C. Nation A has a comparative disadvantage in both goods.
D. Nation A has a comparative advantage in both goods.
5. Mutually beneficial trade
A. Allows both countries to consume a larger bundle of goods than before trade occurred.( )
B. Allows only the more productive country to consume a larger bundle of goods than before trade occurred.
C. Allows only the less productive country to consume a larger bundle of goods than before trade occurred.
D. Causes changes only in production, not consumption.
6. In the absence of trade, the consumption points available to a nation ( )
A. Are above the production possibility curve.
B. Are on or inside the production possibility curve.
C. Lie on the production possibility curve.
D. Cannot be identified.
